Trump Administration’s Unique Deal with Nvidia and AMD
Nvidia and AMD have agreed to pay 15% of their revenues from China AI chip sales to the U.S. government in exchange for export licenses to sell in China. This strategic move could potentially raise $2 billion annually for the U.S. treasury. The Trump administration’s approach is creating an uneven playing field in the tech industry.
Under the arrangement, Nvidia and AMD will share part of their chip sales profits with the U.S. government. The potential boost to U.S. economy from the chip sales is estimated at $2 billion per year, according to the New York Times. While accessing the vast Chinese market is beneficial for Nvidia and AMD, concerns are raised about the necessity for pay-to-play deals with the administration.
Last week, President Donald Trump announced a 100% tariff on semiconductors, unless companies invest in U.S.-based manufacturing. Notably, exemptions were granted to Apple after CEO Tim Cook’s visit. Nvidia CEO visited the White House, leading to waivers for selling H20 chips to China. Intel CEO is also expected to visit amidst accusations of improper ties to China.
